Glossary Terms:

Frontier Specialists

Glossary terms from:
http://www.econedlink.org/e57


Absolute Advantage

The ability to produce more units of a good or service than some other producer, using the same quantity of resources.

Benefit

Monetary or non-monetary gain received because of an action taken or a decision made.

Comparative Advantage

The ability to produce a good or service at a lower opportunity cost than some other producer. This is the economic basis for specialization and trade.

Competition

Attempts by two or more individuals or organizations to acquire the same goods, services, or productive and financial resources. Consumers compete with other consumers for goods and services. Producers compete with other producers for sales to consumers.

Consume

To buy and use a good or service.

Distribution

The allocation or dividing up of the goods and services a society produces.

Exchange

Trading a good or service for another good or service, or for money.

Free Trade

The voluntary exchange of goods and services in the absence of trade barriers and restrictions.

Globalization

Although there is no one precise definition, the term usually refers to the increased flow of trade, people, investment, technology, culture and ideas among countries.

Goods

Tangible objects that satisfy economic wants.

Interdependence

A situation in which decisions made by one person affect decisions made by other people, or events in one part of the world or sector of the economy affect other parts of the world or other sectors of the economy.

Interest

Money paid regularly, at a particular rate, for the use of borrowed money.

Land

"Gifts of nature" that can be used to produce goods and services; for example, oceans, air, mineral deposits, virgin forests and actual fields of land. When investments are made to improve fields of land or other natural resources, those resources become, in part, capital resources. Also known as natural resources.

Opportunity Cost

The second-best alternative (or the value of that alternative) that must be given up when scarce resources are used for one purpose instead of another.

Product

A good or service that can be used to satisfy a want.

Production

A process of manufacturing, growing, designing, or otherwise using productive resources to create goods or services used to to satisfy a want.

Productive Resources

Natural resources, human resources, capital resources and entrepreneurship used to make goods and services.

Resources

The basic kinds of resources used to produce goods and services: land or natural resources, human resources (including labor and entrepreneurship), and capital.

Services

Activities performed by people, firms or government agencies to satisfy economic wants.

Specialization

A situation in which people produce a narrower range of goods and services than they consume. Specialization increases productivity; it also requires trade and increases interdependence.

Trade

The exchange of goods and services for money or other goods and services.

Workers

People employed to do work, producing goods and services.